Turning aspirations into action

The challenge of accelerating decarbonisation will require fundamental change from utilities but one expert has told Utility Week that there is no time for “perfect policy” and that companies must be able to fail fast and learn fast. Academics, regulators and senior figures shared their views at Utility Week’s Adapting for Net Zero conference.

Just days after COP26 drew to a close and a last-minute climate deal was agreed, the Utility Week Adapting for Net Zero conference brought the utilities sector together to discuss the challenges and opportunities that are set to define a complex period of transition.

Speaking at the Utility Week event, sponsored by Cisco, figures at the energy and water regulators welcomed the discussions sparked by COP26, as well the ongoing work to transform net-zero aspirations into action.

Janet Dennett-Thorpe, deputy director for decarbonisation and energy transition at Ofgem, acknowledged that while the net-zero transition is underway, more fundamental change is needed across the sector.

She said: “We’re going to need a new energy system, which is quite different to the one we’ve seen before […] We’re going to need a vast range of different sources of flexibility. Some of that is going to be big and some of that is going to involve consumers.”

John Russell, senior director of strategy, finance and infrastructure at Ofwat, similarly set out the scale of change that will be required in the water sector within the next three decades.

“The bottom line is significant change is required. And if we look ahead to 2050, we know that a step change in outcomes is needed,” he said.

“It’s not just about doing the day job of providing water and sewerage services to millions of homes and businesses marginally better. It’s about fundamental transformation and doing the day job in what might be radically different ways.”

But while transformational change is required, Jeff Hardy, senior research fellow at the Grantham Institute for Climate Change, insisted that there is no time for “perfect policy” and that utilities must be able to fail fast and learn fast.

“We need to aim for good enough,” he added.

While policy decisions will be critical, there was consensus among the utility sector experts in attendance that the consumer will be key to the UK meeting its net zero target.

Ian Cameron, head of innovation at UK Power Networks, underlined the importance of better consumer engagement and called for the sector to “make energy cool again” so that customers are more aware and informed regarding the net zero transition.

Mike Keil, director of policy, research and campaigning at water watchdog CCW, added that water consumers are similarly unaware of how they can contribute to protecting the environment.

Placing customers at the heart of business decisions has never been more critical for water and energy companies alike. But Lisa Gahan, regulatory director at South West Water, summed up the importance of not getting “bogged down” in the detail of net-zero plans. “We need to keep our plans simple so that colleagues can get behind it and customers can find it easy to understand and easy to engage with.

“Ultimately, I think we all want to rest easy, knowing that we did everything we could for our planet, for our children, their children, and generations to come.”